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Highlights
- Bitcoin correlation with S&P 500 has breached 2 year low
- The price of Bitcoin is showing signs of uptrend but not enough to trigger bull run
- Spot Bitcoin ETF might trigger the next run for the coin with Q3 expectation
The price of Bitcoin (BTC) is showcasing a very troubling selloff, one that has triggered a rare correlation break with the S&P 500 Index. Despite being a traditional finance stock market performance tracker, the growth trend of S&P and Bitcoin has stayed similar until now.
The Bitcoin and S&P 500 Trend
According to data insights from the crypto analytics platform Santiment, the mild recovery recorded in Bitcoin this week has not changed its bearish trends. Santiment noted that the bearish trend of BTC came at a time when the S&P 500 and US equities continued to flourish.
According to the latest market data, the price of BTC has inked a 0.7% surge in 24 hours to $58,064.45. While this is low comparatively, the S&P 500 has added 50.37% to its value, pegged at 5,634.91 atop a 0.90% surge. When expanded over the past week, BTC is up marginally by 2.97% while the S&P 500 is up 1.21%.
📊 Despite a mild recovery to end the week, Bitcoin’s recent dip came as the S&P 500 and equities continued to flourish. This has been a rare sight for the past 3 years, with most of crypto’s runs coming in tandem. BTC lagging behind suggests an eventual bullish catch up period. pic.twitter.com/q4FnwmZMpK
— Santiment (@santimentfeed) July 12, 2024
Per Santiment data, on the 5-week timeline, BTC is performing woefully relative to the S&P 500. In this timeframe, the coin is down by 19.4% with the S&P 500 growing by 5.4%. This confirms the diverging correlation, potentially pushing both assets on a different growth path.
While it might come off as a concern, Santiment pointed out that this is a positive twist for BTC. This is because the price of the coin records its biggest gains whenever it maintains little to no correlation with equities. The breakout expectation of Bitcoin as projected by Santiment comes with no specific timeline.
When Return To ATH?
The price of BTC topped the All-Time High (ATH) of $73,750.07 in mid-March. Since then, the coin has traded lower as spot Bitcoin ETF realities became priced into the market.
With Grayscale losing funds through consistent outflow, it is counterbalancing the ETF inflow from other issuers. The expectations of spot Ethereum ETF products have also failed to reboot sentiment, further elongating the revival of Bitcoin. Overall, the rebound of Bitcoin might see the coin form support at $60,000 to start with.
Optimistic traders project the end of Q3 for Bitcoin to return to its ATH.
Read More: XRP And LUNC Communities Scoff At Gary Gensler’s Call For SEC Tip
Addressing Bitcoin Core Vulnerabilities
A recent report from Bitcoin Optech stated that while the Bitcoin developers have fixed the vulnerabilities in recent releases, they could still allow attacks on the nodes running outdated Bitcoin core versions.
As a result, the Bitcoin core developers have released a new security disclosure policy to bring greater transparency and communication regarding these vulnerabilities. Historically, the project has been criticized for insufficient public disclosure of security-critical bugs, creating a misconception that Bitcoin Core is bug-free.
Libbitcoin developer Eric Voskuil highlighted in a message to the Bitcoin mailing list that this misconception is misleading and potentially dangerous, as it downplays the risks associated with using outdated software versions.
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